Obamacare – otherwise known as the Patient Protection and Affordable Care Act – is a 900-page, baggy monster of a statute. Its objective, namely something close to universal health care for Americans is sound, but thanks to Republican opposition, the chosen vehicle is complex, convoluted and compromised. Some of its drafting is bad. And fights over its future continue.
Last week, two different U.S. federal appeals courts took opposite positions on whether one essential element of the ACA is legal: the subsidies in the form of tax credits that help lower- and lower-middle-income Americans to buy affordable health insurance through a federal health-insurance market or “exchange,” in the 36 states that have declined to set up their own exchanges.
An appeal to the Supreme Court seems inevitable, and it may well be a major issue in the midterm November elections.
In designing the law, President Barack Obama and the Democrats sought to accommodate state governments by their giving them flexibility to shape their own exchanges and tax credits. Unexpectly, 36 states refused to create any exchanges at all; most have Republican governors. That left it to the federal government to step in, or see Obamacare gutted.
In court, the Obama administration argued the federal government “stands in the shoes” that the states had been expected to fill. The legal debate is about whether Washington actually has the power to institute these tax credits for low-income earners, rather than just let them fall back on Medicaid, the existing program that looks after the very poor. And there is a gap in the wording of the ACA. The drafters apparently hadn’t counted on some state governments being so ideologically opposed that they would simply refuse to pass along federal benefits to their own citizens.
The Obama administration’s position makes the most sense. Even Republicans can’t argue with a a straight face that Congress intended to create this strange, fatal loophole. Obamacare isn’t perfect. But the idea deserves to succeed or not on its merits. It shouldn’t be kneecapped by a minor linguistic technicality.